Half the market is sitting on its hands waiting for SpaceX to go public. While everyone waits, former penny stock Astrotech Corporation (NASDAQ: ASTC) ran more than 2,500%* in three days.
That’s the whole lesson in one sentence. Let me break it down.
( *As always, past performance doesn’t predict future results! )
The Trade Everyone’s Waiting For Doesn’t Have A Chart Yet
SpaceX is coming. The company filed to go public, plans to start marketing the deal as soon as June 4, and could price as early as June 11 under the ticker SPCX on the Nasdaq. It’s looking to raise up to $75 billion, which would make it the biggest IPO in history.
If you want to know how I’m trading it — apply for my Trading Challenge!
Then the number started moving the wrong way. Back in April the talk was a valuation above $2 trillion. Now the reported target is “at least” $1.8 trillion. The price tag is shrinking before the stock has traded a single share.
Here’s my problem with trading any IPO on day one. There is no chart. No support, no resistance, no history of how the stock behaves when the crowd panics. You can’t do pattern recognition on a stock with zero patterns. It’s a guess dressed up as a trade.
And the history isn’t kind. One study found the seven largest IPOs ever, the ones over $50 billion, posted a median loss of about 32% a year after listing. The bigger the hype, the worse the hangover.
I’m not telling you SpaceX is a bad company. I’m telling you a great company and a tradeable stock are two different things, and on opening day you don’t have the second one yet.
None of that means I’m sitting on my hands. I think the real opportunity is the run-up into the IPO, not the open, and I said as much to Matt on a recent livestream. The weeks of anticipation are when money pours into the whole space theme and the names with real catalysts start running. That part is tradeable. The open, day one, is the part I leave alone.
So trade the run-up, not the lottery ticket.
While You Wait, ASTC Went Vertical
Astrotech Corporation (NASDAQ: ASTC) is the opposite of an IPO. It has years of chart history. And for most of this month it was a sleepy stock chopping around $2 to $3 on no volume.
Then it caught a real catalyst. Its 1st Detect unit got ECAC/EU G1 certification for its TRACER 1000 explosives-detection system, the top standard for airport security in Europe. The market did the math on what airport contracts could mean for a company this small, and the stock detonated.
From the low single digits it ran through the teens, into the thirties, and past $60. As I write this it’s trading north of $60 after printing a high near $65. That’s a gain of more than 2,500%* on the week off a sub-$2 base.
Read more: ASTC Stock Explodes As Traders Bet On Space And Security Pivot
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That’s the move people are missing while they refresh the SpaceX filing.
I Traded This Exact Stock A Few Years Ago, And I Lost
Here’s the part that matters more than the 2,500%*.
A few years back I bought ASTC in the $1.60s. Same company, same kind of catalyst, its detection product getting picked up at an airport. It was a former runner with a history of spiking on this exact type of news, so the setup was clean.
It didn’t break out the way I wanted. So I followed rule number one and cut losses quickly. After commissions, the whole trade cost me $160.
Read more: Former Supernova and Short Squeeze: Lessons From ASTC
Study that one, not the 2,500%* gain.
The highlight reel is easy to look at. Everyone wants to learn from the trade that went up 25x*. The better teacher is the trade that didn’t work, because that’s the one that happens most of the time. ASTC was a “former supernova” for a reason. It had spiked and failed to hold over and over. The one time in years it actually holds and rips is the exception, not the plan.
You don’t get to know in advance which one you’re in. So you size for the failure, not the moonshot. I risked pennies to make the move. When it didn’t come, I was out for a rounding error and lived to trade the next one. That discipline is the only reason I’m still here years later watching this thing run again.
This isn’t just my rule. My top student Jack Kellogg wins barely half his trades. He’s made millions anyway, because his winners dwarf his losers and he cuts the losers fast. That’s the whole game. Small losses, bigger wins, and the patience to keep at it until a setup like ASTC finally pays.
The Space Trade Is Blowing Up, Some Of It Literally
The whole space sector has gone parabolic on SpaceX-IPO excitement. Rocket Lab (NASDAQ: RKLB) was up about 90% in a month. The space ETFs are up double digits on the year. Money piled into anything orbit-adjacent.
Then Thursday night one of Blue Origin’s New Glenn rockets exploded on the pad in a giant fireball. Everyone was safe. The stocks weren’t. AST SpaceMobile (NASDAQ: ASTS), which was counting on Blue Origin for launches, dropped around 15%. Rocket Lab gave back about 5%. Firefly, Intuitive Machines, and Voyager all fell too.
That’s what crowding into a theme on hype looks like when reality shows up. The charts were telling you these names were stretched. One headline, and the air came out fast.
What To Actually Do
Nothing is guaranteed in this market. Not the SpaceX IPO, not ASTC holding $60, not any of it.
What you can control is preparation. Build a watchlist of stocks with real chart history and real catalysts. Set alerts at your levels instead of predicting where price goes. Size every trade so a failed breakout costs you a little and a real one pays you a lot.
I’m not buying ASTC up here, and I’m not buying the SpaceX IPO blind on day one. I’m watching, I’m prepared, and I’ll react to the chart when a setup I recognize shows up. That’s the job.
If you want to learn how to trade plays like this instead of chasing them, apply for my Trading Challenge.
This is stock news, not investment advice. Timothy Sykes News delivers real-time stock market news focused on key catalysts driving short-term price movements. Our content is tailored for active traders and investors seeking to capitalize on rapid price fluctuations, particularly in volatile sectors like penny stocks. Readers come to us for detailed coverage on earnings reports, mergers, FDA approvals, new contracts, and unusual trading volumes that can trigger significant short-term price action. Some users utilize our news to explain sudden stock movements, while others rely on it for diligent research into potential investment opportunities.
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